The URL can be used to link to this page

Home My WebLink AboutCOUNCIL - AGENDA ITEM - 10/30/2018 - KEEP FORT COLLINS GREAT SUNSETDATE: STAFF: October 30, 2018 Ginny Sawyer, Policy and Project Manager WORK SESSION ITEM City Council SUBJECT FOR DISCUSSION Keep Fort Collins Great Sunset. EXECUTIVE SUMMARY The purpose of this work session is to update Council on outreach related to the Keep Fort Collins Great (KFCG) tax sunset and to seek direction on desired steps moving. KFCG is a .85-cent voter approved dedicated tax that will sunset December 31, 2020. April 2019 is the anticipated election for a potential ballot related question to address funding needs. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED 1. What additional information does Council need moving forward? 2. What questions does Council have at this time? BACKGROUND / DISCUSSION Since 2011, KFCG has funded basic operations and enabled the City to both maintain a desired level of service and respond to community desires in an environment of population growth and annual inflation. The revenues from this tax are, by ballot, distributed to the following areas: 33% Street Maintenance and Repair 17% Other Transportation Needs 17% Police Services 11% Parks and Recreation 11% Other Community Priorities 11% Poudre Fire Authority Prior to the 2020 sunset of KFCG, and before building the 2021-22 budget, the City would like to fully engage the community in the decision of how to fund current service levels or make alternative plans for a lower service level at a lower cost. If the desire is to replace KFCG funds in full this can be achieved through a dedicated tax, an increase to the on-going base rate, or a combination of these. If City Council or the community decide NOT to replace KFCG revenue in full, reduced levels of service from the general fund will need to be identified during the 2020 budget process for 2021-22 budgets. Outreach Since the last work session, staff has begun in-depth public engagement on KFCG with events continuing into November. Audiences include business organizations (Downtown Business Association, Visitor’s Board, North Fort Collins Business Association, Chamber of Commerce Legislative group, UniverCity Connections); Boards and Commissions, open community meetings in each Council district, CityWorks alumni groups, and an event with the Center for Public Deliberation. October 30, 2018 Page 2 All of these events have included a background information and varying data related to KFCG and City financial information over time. (Attachment 1) The general questions put to these groups focused on do residents like the current level of service they experience, and do they feel the service is provided at the right price. Discussions also focus on the functions and specifics of base rate and dedicated taxes. In general, feedback highlights include: ▪ Overall support for replacing most if not all revenue. ▪ Overall support for an increase to the base rate (particularly to cover police, streets, and fire.) ▪ Thoughts of aligning all dedicated taxes (i.e., if a dedicated tax is pursued starting in 2020 make it a 5- year or 15-year term.) ▪ City revenue and expense is a challenging conversation for the public to be able to provide specific revenue options. ▪ Majority like level of service with limited suggestions for where to reduce. The following chart shows the existing state and an example of including police, streets and fire in the base rate. Current Option A Base Rate Sales Tax 2.25% 2.77% Dedicated Natural Areas 0.25% 0.25% Community Capital Improvement 0.25% 0.25% Street Maintenance 0.25% 0.25% Dedicated Renewable Taxes 0.75% 0.75% KFCG - .85% Street Maintenance - 33% 0.28% in base Other Transportation - 17% 0.145% 0.145% Police - 17% 0.145% in base Fire - 11% 0.094% in base Parks & Recreation - 11% 0.094% 0.094% Other Community Priorities - 11% 0.094% 0.094% KFCG Renewable 0.85% 0.33% Total Sales Tax 3.85% 3.85% If a current state scenario is desired, the distributions could be reconfigured. Next Steps ▪ Outreach will continue into November. ▪ Council work sessions scheduled: o November 13 o December 11 o January 22 October 30, 2018 Page 3 ▪ Council regular meeting o February 5 - last day to refer language for April 2019 election ATTACHMENTS 1. Background Information on KFCG (PDF) 2. Power Point Presentation (PDF) October 30, 2018 Council Work Session Attachment/KFCG 2001-2017 Average Annual Growth 2001 2017 Annual Average % Population 125,473 167,492 1.71% CPI 181.3 255.0 2.03% General Fund $94.4M $139.1M 2.31% Full-Time Employee (FTE) Growth and Growth/Population FTE TOTAL FTE/1,000 POPULATION 2008 2018 2008 2018 TOTAL CLASS/UNCLASS 1,184.10 1,466.45 8.46 8.57 Poudre Fire Authority 169.5 212.00 1.02 1.01 ATTACHMENT 1 6.6 6.5 6.4 6.3 6.3 6.6 6.2 6.0 5.6 5.3 5.3 5.7 5.8 5.6 5.6 5.4 5.4 5.5 5.5 ‐ 1 2 3 4 5 6 7 8 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015201620172018 Cents Fiscal Years Price of Government for the City of Fort Collins (cents of every dollar earned going to pay for City services, including utilities and golf) 2017‐2018 Estimated Current Taxes and Comparisons City Combined Total City Base City Dedicated State County Other Boulder 8.85% 2.68% 1.18% 2.90% 0.985% 1.10% Co Springs 8.25% 2.50% 0.62% 2.90% 1.23% 1.00% Denver 7.65% 3.65% 0.00% 2.90% 1.10% Fort Collins 7.30% 2.25% 1.60% 2.90% 0.55% 0.00% Loveland 6.45% 3.00% 0.00% 2.90% 0.55% 0.00% Other is primarily RTD & Pikes Peak Rural Transportation plus .1% Cultural .24% of Fort Collins 2.25% base rate funds Transit ATTACHMENT 1 Collections to Date 2011 2012 2013 2014 2015 2016 2017 Sales Tax $16.8 $17.7 $18.5 $20.2 $21.1 $21.9 $22.5 Use Tax $3.0 $4.0 $4.3 $5.7 $5.5 $5.6 $4.9 TOTAL $19.8 $21.8 $22.8 $25.9 $26.6 $27.4 $27.4 91.00% 90.45% 92.13% 91.61% 96.01% 93.86% 90.12% 85% 87% 89% 91% 93% 95% 97% 99% $‐ $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 2011 2012 2013 2014 2015 2016 2017 KFCG Expenses Total Operations Supported by KFCG % Ongoing Operations Supported by KFCG ATTACHMENT 1 1 City Council Work Session October 30, 2018 Keep Fort Collins Great-2020 Sunset ATTACHMENT 2 Direction Sought 1. What additional information does Council need moving forward? 2. What questions does Council have at this time? 2 ATTACHMENT 2 Background  Since 1982, on-going sales tax rate = 2.25%  3 dedicated ¼-cent taxes:  Street Maintenance  Capital Improvement  Open Space  Keep Fort Collins Great  .85%  10-year sunset (2011-2020) Local Total: 3.85% 3 ATTACHMENT 2 4 ATTACHMENT 2 Keep Fort Collins Great Breakdown/Total 2011-18: • 33% Street Maintenance and Repair- $65M • 17% Other Transportation Needs- $32M • 17% Police Services- $32M • 11% Parks and Recreation- $22M • 11% Poudre Fire Authority- $21M • 11% Other Community Priorities- $22M • Annual spending and Efficiency reports: fcgov.com/kfcg 5 ATTACHMENT 2 KFCG Sunset Key Elements  KFCG revenue can be replaced in full or at another amount.  Base rate can be increased  Dedicated tax can be created  If the desire is to NOT replace KFCG revenue in full reduced levels of service from the general fund will need to be identified. Council direction to date:  No additional tax on groceries  Don’t increase total tax burden 6 ATTACHMENT 2 Outreach  Boards & Commissions  Business Groups  Open Meetings  Community Issue Forum  CityWork Alums Do you like the current level of service you experience as a resident? Is the price right? 7 ATTACHMENT 2 General Feedback  Overall support for replacing most if not all revenue.  Overall support for an increase to the base rate (particularly to cover police, streets, and fire.)  Thoughts of aligning all dedicated taxes (i.e. if a dedicated tax is pursued starting in 2020 make it a 5-year or 15-year term.)  City revenue and expense is a challenging conversation for the public to be able to provide specific revenue options.  Majority like level of service with limited suggestions for where to reduce. 8 ATTACHMENT 2 9 Current Option A Base Rate Sales Tax 2.25% 2.77% Dedicated Natural Areas/Streets/Capital 0.75% 0.75% KFCG - .85% Street Maintenance - 33% 0.28% in base Other Transportation - 17% 0.145% 0.145% Police - 17% 0.145% in base Fire - 11% 0.094% in base Parks & Recreation - 11% 0.094% 0.094% Other Community Priorities - 11% 0.094% 0.094% KFCG Renewable Total 0.85% 0.33% Total Tax 3.85% 3.85% ATTACHMENT 2 Timeline  On-going outreach  November 13 Work Session  December 11 Work Session  January 22 Work Session  Last Day to Refer Ballot language- February 5, 2019  Election-April 2, 2019 10 ATTACHMENT 2 Direction Sought 1. What additional information does Council need moving forward? 2. What questions does Council have at this time? 11 ATTACHMENT 2